Nationwideis warning its customers about sneaky foreign charges that are costing British holidaymakers millions of pounds - just weeks after Which? revealed the underhand practice.

In January's issue of Which? we exposed how some European shops are billing tourists in sterling rather than in the local currency.

This practice - known as 'dynamic currency conversion' - frequently leads to customers paying over the odds as the sterling rate is often a much poorer deal. It typically adds 3 per cent to the cost of the transaction.

Nationwide has now launched a guide to stop its customers falling victim to these unnecessary charges. It estimates they cost British tourists GBP 5 million last July alone. The guide is available in branches and will be included with Nationwide travel insurance documents.

Pay in local currency

Nationwide's guide recommends its cardholders always opt to pay for purchases in the local currency of the country they're visiting. This ensures that they get the best exchange rate and no commission charges.

It says the conversion scam has become prevalent in Spain, France and Italy - three of the most popular UK holiday destinations, and so the guide includes useful phrases to help customers request that their transaction is in local currency.

Which? Senior Researcher Naomi Newman said: 'We're pleased to see Nationwide alerting cardholders to the fact that they are able to choose the currency they want to pay in and offering guidance on how to make a choice. We'd like to see other card providers offering similar guidance'.